ACEM

Industry concern that US-EU trade dispute could impact the motorcycle market

The European Association of Motorcycle Manufacturers (ACEM - the Brussels based international motorcycle industry trade association for Europe) has stated that it is “deeply concerned at the recent press statements delivered by the American and European authorities in relation to US imports of steel and aluminium”.
ACEM goes on to say that it “appreciates the reasons behind potential retaliation action by the EU in response to the US increases of tariffs on imported steel and aluminium. However, the motorcycle industry would be severely damaged if brought into this trade dispute”.

“We trust that American and European authorities will avoid triggering a global trade escalation. It could be extremely damaging for the motorcycle industry on both sides of the Atlantic”

In February one of ACEM’s member companies, Harley-Davidson, was mentioned by EU Commission President Jean-Claude Juncker as being amongst possible targets for retaliation by European authorities. Though largely interpreted at the time as a symbolic broadside in response to the Trump administration’s unilateral decision, and one clearly aimed at House of Representatives Speaker and theoretical Republican Party Trump political ally Paul Ryan’s home state (Wisconsin, where Harley is headquartered), Juncker’s remarks nonetheless rattled cages in the European motorcycle industry.
ACEM wrote to EU Trade Commissioner Cecilia Malmström stressing that while the industry understands the reasons behind the EU’s intention to retaliate firmly and swiftly, it believes that a potential increase of customs duties on American exports of motorcycles would clearly be damaging not only to the American companies concerned, but also to European economies and jobs.
“It might also, in turn, result in the US administration imposing retaliatory tariffs on European exports. Overall, this could lead to considerable negative economic impacts and job losses for the motorcycle sector in both the US and Europe, particularly in areas such as the manufacturing and distribution of vehicles, parts and components”.
This, of course, is not the first time that motorcycles have been a pawn in the worldwide game of chess. Back in the early 1980s, the Reagan administration famously threatened and indeed imposed Japanese manufacturers with draconian import tariffs as part of its efforts to help save Harley-Davidson from bankruptcy and start manufacturing in the USA, providing domestic jobs. 

Stefan Pierer, CEO of KTM AG and President of ACEM: “The US and the EU should be working together to facilitate international trade and regulatory convergence, not to restrict it by adopting unilateral and politically motivated measures”

As recently as last year the Federal Trade Commissioner revived a threat that had been made some years before to impose a ban on the import of sub 500 cc motorcycles and PTWs made in Europe in response to the ban that the EU has in place on genetically modified foodstuffs – specifically U.S. beef exports to Europe.
Stefan Pierer, CEO of KTM AG and President of ACEM, said that “motorcycle companies are global players committed to free and balanced trade agreements. The US and the EU should be working together to facilitate international trade and regulatory convergence, not to restrict it by adopting unilateral and politically motivated measures”.
Several of Europe’s major National Trade Associations have also voiced their concern. In advance of a March 22nd Heads of State and Government meeting in Brussels at which European trade policy was to be discussed, the Secretary General of ANESDOR in Spain, José María Riaño, indicated that “we urge the EU to think about the negative consequences that these measures could entail , several Spanish manufacturers of two-wheeled vehicles, such as Torrot, Vertigo and Rieju among others, and our strong components and accessory manufacturing sector would be affected. This commercial conflict does not benefit any of the parties and the only way out is the dialogue between both administrations to find a solution”.
The UK motorcycle industry warned that trade tariffs on motorcycles will result in job losses in the UK, where the industry employs an estimated 58,500 people across 5,700 businesses. Tony Campbell, CEO of the MCIA (Motorcycle Industry Associations) in the UK, said that “targeting high profile brands is headline grabbing, but won’t have any real value in resolving this situation and will seriously harm an industry which is already under pressure. I am hopeful that common sense will prevail.”
Antonio Perlot, ACEM Secretary General, said: “The EU is a key market for American motorcycle brands. But the US is also Europe’s first trading partner in the motorcycle segment. We trust that American and European authorities will avoid triggering a global trade escalation, which could be extremely damaging for the motorcycle industry on both sides of the Atlantic”.
ACEM says that some 156,000 jobs in the EU depend on the motorcycle, moped, tricycle and quadricycle industry. According to EUROSTAT figures, in 2016 the EU exports of motorcycles to the US amounted to € 483.1 million, which represented 29.1% of all European motorcycle exports, with  EU-based businesses exporting € 139.6 million in motorcycle parts and components to America (30.8% of the total). In 2016 the US was the number one destination for European exports of motorcycles as well as parts and components.